Lilly beats Q1 estimates and raises full-year guidance

Blue Owl Capitalshares rose around 5% premarket after reporting Q1 results that signal its broader business is resilient in the face of some stress in private credit markets.

The key numbers:

• Assets under management of $314.9 billion (estimate: $315.4 billion).

• Fee-related earnings of $393.6 million (estimate: $383.5 million).

Ahead of earnings, analysts flagged expectations for a softer quarter driven by weaker fundraising and elevated redemptions, particularly in Blue Owl’s retail-focused private credit vehicles. Those funds have been a key growth engine but also a pressure point as investors seek exit liquidity that the asset manager has been unwilling to provide in full. Based on the reaction, much of that concern may have already been in the price.

Shares of the stock have slumped more than 40% year to date with Blue Owl emerging as a proxy for broader concerns across the $1.8 trillion private credit market. Redemption requests have surged in recent months, at one point exceeding 40% in one fund and more than 20% in another, forcing the firm to gate withdrawals and sell assets to return capital.

The pressure has also been amplified by the firm’s exposure to software borrowers, where investors are increasingly questioning how AI could reshape the industry’s earnings durability and loan performance.

During Blue Owl's February earnings call, however, co-CEO Marc Lipschultz said there were no "red flags" or "yellow flags" in its tech portfolio.

Judging by the price action in recent months, and what its peers are saying, that claim might be overly optimistic. Earlier this week, publicly traded private credit fund Ares Capital Corp marked down the value of loans to three software businesses by up to 18 cents on the dollar in its Q1 report, which helped push net unrealized losses up to $357 million.

On Thursday morning, the American Automobile Association (AAA) reported that the national average gas price in the US had risen to $4.30 per gallon — the highest level seen since July 2022 — as the global energy crisis continues to trickle down to consumers.

The fresh pain at the pump comes as more oil supply disruptions in the Middle East continue to drive up Brent crude prices, where front-month futures contracts just hit a four-year high, with the international benchmark briefly topping $126 a barrel. Unsurprisingly, if that level holds, it'd be hard to foresee gas prices going anywhere but further up, given the two are so intrinsically linked.

With the Strait of Hormuz likely to remain blockaded as a result of the ongoing conflict, analysts are predicting that the national average gas price could hit $4.50 per gallon in the next week or two. Indeed, Gas Buddy's Patrick De Haan forecast prices reaching as high as $5 a gallon by Memorial Day, and up to $6 a gallon by later in the summer, saying: “Nothing's impossible at this point.”

However, according to AAA data, gasoline prices have already topped $6 a gallon in California, marking the highest level since October 2023. For context, no other state has ever surpassed the $6-a-gallon mark, with Bloomberg reporting that the price in the state was $4.64 a gallon at the outset of the war.

Brent crude prices jumped to a four-year high on Thursday after reports that President Trump is set to receive a briefing on potential military action against Iran, raising concerns that oil supply disruptions in the Middle East could extend further.

Citing sources with knowledge, Axios reported late on Wednesday that the US Central Command (CENTCOM) will brief a plan for a “short and powerful” wave of strikes on Iran, in a bid to accelerate negotiations and weaken Iran's position. A ceasefire has held since early April but talks to resolve the conflict have been deadlocked in recent days, with Iran's leadership — a group that seems scattered and fractured — wanting some control over the Strait of Hormuz, with reparations for war damages also brought up two weeks ago. Yesterday, reports emerged that President Trump had rejected Iran's latest offer, maintaining the naval blockade in the region until an agreement about Iran's nuclear program is reached.

Brent crude futures jumped more than 7%, briefly touching $126 per barrel before retreating slightly — the highest price since Russia’s invasion of Ukraine in 2022. US West Texas Intermediate futures also extended its 7% gain in the previous session, reaching past $108 a barrel.

Trump discussed ways to mitigate the impact of a prolonged blockade on American consumers with oil companies on Tuesday, the White House said.

US equity futures, meanwhile, have broadly shrugged off the news. Contracts on the S&P 500 point to a broadly unchanged open, as traders digest the bevy of mega tech earnings last night.